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Forward Financing LLC v. Business GPS, LLC

United States District Court, D. Massachusetts

June 24, 2019

FORWARD FINANCING, LLC
v.
BUSINESS GPS, LLC

          MEMORANDUM OF DECISION

          RYA W. ZOBEL, SENIOR UNITED STATES DISTRICT JUDGE

         Plaintiff, Forward Financing, LLC, provides cash advances to merchant businesses in exchange for interest in future accounts and receivables. Defendant, Business GPS, LLC, provides debt negotiation and mitigation services.

         Plaintiff alleges in a two-count complaint that defendant tortiously interfered with its client contracts (Count I) and that this conduct constituted unfair and deceptive business practice under Massachusetts General Laws chapter 93A, § 11 (Count II). Defendant has moved for summary judgment as to both counts.

         I. Factual Background[1]

         Plaintiff requires its clients to enter “Future Sales Receipts Agreements” with its clients, pursuant to which it provides immediate cash advances in exchange for a percentage of the clients' daily business receipts. These payments continue until the first of either the contract's expiration or the repayment to plaintiff of an agreed-upon amount.[2]

         Plaintiff and defendant share twelve clients identified in the complaint. Defendant admits that it worked with these clients to renegotiate their debt to plaintiff, but denies that its conduct rose to the level of tortious interference or any unfair and deceptive business practice.

         II. Legal Standard

         Summary judgment is appropriate when the moving party “shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “An issue is ‘genuine' for purposes of summary judgment if ‘the evidence is such that a reasonable jury could return a verdict for the nonmoving party,' and a ‘material fact' is one which ‘might affect the outcome of the suit under the governing law.'” Poulis-Minott v. Smith, 388 F.3d 354, 363 (1st Cir. 2004) (quoting Hayes v. Douglas Dynamics, Inc., 8 F.3d 88, 90 (1st Cir. 1993)). The court reviews the record in the light most favorable to the nonmoving party. Podiatrist Ass'n, Inc. v. La Cruz Azul De P.R., Inc., 332 F.3d 6, 13 (1st Cir. 2003).

         III. Count I: Tortious Interference

         To prove tortious interference with contract, plaintiff must establish that “(1) [it] had a contract with a third party; (2) the defendant knowingly interfered with that contract ...; (3) the defendant's interference, in addition to being intentional, was improper in motive or means; and (4) the plaintiff was harmed by the defendant's actions.” O'Donnell v. Boggs, 611 F.3d 50, 54 (1st Cir. 2010) (quoting Harrison v. NetCentric Corp., 744 N.E.2d 622, 632 (Mass. 2001)).

         Defendant concedes that plaintiff had contracts with the mutual clients and that it was aware of these contracts, but argues that it is entitled to summary judgment because plaintiff cannot establish the third and fourth elements of their claim.

         A. Improper Motive or Means

          Determining whether a defendant's motive or means were improper requires a case-by-case balancing of several factors, including, inter alia, the nature of defendant's conduct, the directness of the contractual interference, and the interests sought to be advanced by the defendant. See Pure Distributors, Inc. v. Baker, 285 F.3d 150, 157 (1st Cir. 2002); see also Restatement (Second) of Torts § 767 (1979). The context-sensitive nature of this inquiry and the sharp factual disputes regarding defendant's actions and intent preclude summary judgment in this case.

         As a preliminary matter, defendant generally denies that it advised merchants to cease payments to plaintiff and breach their respective contracts. Yet plaintiff cites deposition testimony, as well as e-mails between defendant and the mutual clients, which suggest that defendant did counsel clients to halt such payments with ...


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